California co-ops renew plea for milk price help

California co-ops renew plea for milk price help

Petition resubmitted to state for temporary increase says industry’s survival is at risk.

by Dennis Halladay, Hoard’s Dairyman Western Editor

California’s largest dairy cooperatives have renewed a plea for help to the California Department of Food and Agriculture (CDFA), warning that survival of the state’s dairy industry is at risk.

On Wednesday this week, California Dairies Inc., Dairy Farmers of America Western Area and Land O’Lakes Inc., jointly resubmitted a petition to CDFA on behalf of all dairies in the state asking for an emergency hearing to consider a temporary increase in the whey component value used in the state’s Class 4b (cheese) milk pricing formula.

The petition says sharply high feed costs – which CDFA’s own data show have increased 55 percent in the last two years – have slashed operating margins and reduced survivability prospects for California dairy farms.

The focus of an emergency hearing would be to increase whey value levels used in the current Class 4b formula. The market value of whey has soared dramatically since it was enacted, and a huge gap now exists between what is being passed along to dairy producers in California versus what producers in federal milk marketing orders receive.

“In light of the pressures being faced by dairymen right now because of high feed prices and low margins, we ask for an emergency hearing so that the proposal can be implemented immediately and remain in place for a six-month period,” says the petition.

“We are mindful of the efforts being made to forge a foundation for a strong and viable dairy industry in the future, and we understand our obligation to be engaged with the rest of the dairy industry. However, our members need to survive in the short-term first,” it adds.

The CDFA Secretary has 15 days to respond to the petition’s request. If a hearing is granted, it could be held as early as mid-January.